UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of December 2024
Commission File No. 001-42293
PTL Limited
(Translation of registrant’s name into English)
111 North Bridge Road
#23-06A
Peninsula Plaza
Singapore 179098
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F
Form 20-F ☒ Form
40-F ☐
Other Events
On December 30, 2024,
PTL Limited (the “Company”) made available its unaudited Financial Results for the six months ended June 30, 2024. A copy
of the report is attached hereto as Exhibit 99.1.
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| |
PTL Limited |
| |
|
|
| Date: December 30, 2024 |
By: |
/s/ Ying Ying, CHOW |
| |
Name: |
Ying Ying, CHOW |
| |
Title |
Chief Executive Officer and Director |
Exhibit 99.1
PTL Limited Announces Financial Results for
the First Half of Fiscal Year 2024
PTL Limited (“PTL” or the “Company”)
(Nasdaq: PTLE) is a limited liability company established under the laws of the British Virgin Islands on December 29, 2023. It is a holding
company with no business operation. The Company, through its wholly-owned subsidiaries, Petrolink Energy Limited (“Petrolink Hong
Kong”) and Petrolink Energy Pte. Ltd. (“Petrolink Singapore”), (collectively, the “Group”), is an established
bunkering facilitator providing marine fuel logistics services for vessel refuelling, primarily serving the Asia Pacific market. The Group
leverages on its close relationships and partnership within our established network in the marine fuel logistic industry, including the
upstream suppliers and downstream customers, to provide a one-stop solution for vessel refuelling. The Group purchases marine fuel from
its suppliers and arrange its suppliers to deliver marine fuel to its customers directly. As a bunker facilitator, the Group’s services
mainly involve (i) facilitating with its suppliers to supply fuel for the use by the customers’ vessels at various ports along their
voyages in the Asia Pacific region; (ii) arranging vessel refuelling activities at competitive pricing to the customers; (iii) offering
trade credit to the customers for vessel refuelling; (iv) handling unforeseeable circumstances faced by the customers and providing contingency
solutions to the customers in a timely manner; and (v) handling disputes, mainly in relation to quality and quantity issues on marine
fuel, if any. The Company today announced its unaudited financial results for the six months ended June 30, 2024 (the “First Half
of Fiscal Year 2024”).
First Half of Fiscal Year 2024 Financial Results
| | |
For the Six Months Ended June 30, | |
Selected Unaudited Interim Condensed
Consolidated Statements of Income Data: | |
2024 USD | | |
2023 USD | | |
Change % | |
| Revenue | |
| 50,273,589 | | |
| 44,254,007 | | |
| 13.6 | |
| Cost of revenue | |
| (49,133,889 | ) | |
| (42,997,119 | ) | |
| 14.3 | |
| Gross profit | |
| 1,139,700 | | |
| 1,256,888 | | |
| (9.3 | ) |
| Selling, general and administrative expenses | |
| (718,758 | ) | |
| (220,296 | ) | |
| 226.3 | |
| Total other (expense) income, net | |
| (2,151 | ) | |
| 7,481 | | |
| (128.8 | ) |
| Income before provision for income taxes | |
| 418,791 | | |
| 1,044,073 | | |
| (59.9 | ) |
| Income tax expense | |
| (98,347 | ) | |
| (150,578 | ) | |
| (34.7 | ) |
| Net income | |
| 320,444 | | |
| 893,495 | | |
| (64.1 | ) |
| Earnings per share – basic and diluted | |
| 0.028 | | |
| 0.079 | | |
| (64.6 | ) |
Revenue
Our revenue increased by $6,019,582, or 13.6%,
from $44,254,007 for the six months ended June 30, 2023 to $50,273,589 for the six months ended June 30, 2024, primarily because of the
increase in our sales volume of approximately 73,633 metric tons for the six months ended June 30, 2023 to approximately 81,702 metric
tons for the six months ended June 30, 2024.
Cost of revenue
Our cost of revenue mainly represented the marine
fuel cost and other costs mainly including the agency fee, barging fee, cancellation charges and survey fee. Our cost of revenue increased
by $6,136,770, or 14.3%, from $42,997,119 for the six months ended June 30, 2023 to $49,133,889 for the six months ended June 30, 2024,
which was mainly due to the increase in our marine fuel costs and in line with the increase in our revenue.
Gross profit
Our gross profit remained relatively stable at
$1,139,700 and $1,256,888 for the six months ended June 30, 2024 and 2023, respectively. Our gross profit margin remained relatively stable
at 2.3% and 2.8% for the six months ended June 30, 2024 and 2023, respectively.
Selling, general and administrative expenses
Our selling, general and administrative expenses
mainly represented the staff costs, agency commission, legal and professional fee, bank charges, utilities expenses, travelling and transportation
costs and office supplies. Our selling, general and administrative expenses increased by $498,462, or 226.3%, from $220,296 for the six
months ended June 30, 2023 to $718,758 for the six months ended June 30, 2024, which was mainly due to the increase in staff cost and
professional fees such as audit, legal and consulting service expenses we incurred for the application of the listing of becoming a publicly
traded company in the United States during the six months ended June 30, 2024, as compared to the six months ended June 30, 2023.
We expect our selling, general and administrative expenses, including, but not limited to, staff costs, to increase in the foreseeable
future, as our business further grows. We expect our legal and professional fees for legal, audit, and advisory services will increase
as we will incur the audit fee, legal fee and advisory fee for this Offering and subsequently become a public after the IPO.
Income tax expense
Our company, PTL Limited, was incorporated in
the British Virgin Islands. Under the current laws of the British Virgin Islands, PTL Limited is not subject to tax on income or capital
gain. Additionally, upon payments of dividends to the shareholders, no British Virgin Islands withholding tax will be imposed.
Petrolink Energy Limited is subject to income
taxes within Hong Kong at the applicable tax rate on taxable income. Hong Kong profit tax rates are 8.25% on assessable profits
up to $256,410 (HK$2,000,000), and 16.5% on any part of assessable profits over $256,410 (HK$2,000,000). For the six months ended June
30, 2024 and 2023, Petrolink Energy Limited had assessable profits arising in Hong Kong and, hence, the provision of current tax of $98,347
and $150,578, respectively, has been made in these periods.
Petrolink Energy Pte. Ltd. is subject to Singapore
Corporate Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Singapore tax
laws. The applicable tax rate is 17% in Singapore, with 75% of the first $7,463 (S$10,000) taxable income and 50% of the next $141,791
(S$190,000) taxable income exempted from income tax. For the six months ended June 30, 2024 and 2023, Petrolink Energy Pte. Ltd. had no
assessable profits arising in Singapore and, hence, no provision of current tax has been made in these periods.
Net income
The net income decreased by $573,051, or 64.1%,
from $893,495 for the six months ended June 30, 2023 to $320,444 for the six months ended June 30, 2024. Such change was the
result of the combination of the changes as discussed above.
Cash Flow
Net cash used in operating activities amounted
to $595,677 for the six months ended June 30, 2024, mainly derived from (i) a decrease in accounts payable of $1,635,755, due to more
settlement to the vendors closer to the end of the six months ended June 30, 2024, as compared to that of fiscal year ended December 31,
2023; and (ii) an increase in accounts receivable of $721,961, due to more billings to the customer closer to the end of the six months
ended June 30, 2024, as compared to that of fiscal year ended December 31, 2023, which was partially offset by (i) net income of $320,444
for the six months ended June 30, 2024; and (ii) a decrease in prepayments and other current assets of $1,591,357, due to the settlement
of the advances to the suppliers for the purchase of marine fuel during the six months ended 30 June 2024.
Net cash provided by operating activities amounted
to $167,091 for the six months ended June 30, 2023, mainly derived from (i) net income of $893,495 for the six months ended June
30, 2023; and (ii) a decrease in accounts receivable of $229,887, due to more settlements by the customers closer to the end of the six
months ended June 30, 2023, as compared to that of the fiscal year ended December 31, 2022, which was partially offset by (i) a decrease
in accounts payable of $1,135,736, due to more settlement to the vendors closer to the end of the six months ended June 30, 2023, as compared
to that of fiscal year ended December 31, 2022.
No net cash was provided by/(used in) investing
activities for the six months ended June 30, 2024 and 2023.
Net cash used in financing activities amounted
to $327,517 for the six months ended June 30, 2024, which mainly included the payments of offering costs related to the initial public
offering of $324,069 during the six months ended June 30, 2024.
No net cash was provided by/(used in) financing
activities for the six months ended June 30, 2023.
Recent Events
On October 17, 2024, the Company closed its IPO
of 1,250,000 ordinary shares, no par value per share, which were priced at $4.00 per share, and the offering was conducted on a firm
commitment basis. The ordinary shares were approved for listing on the Nasdaq Capital Market and commenced trading under the ticker symbol
“PTLE” on October 16, 2024.
On November 4, 2024, Dominari Securities LLC,
as the representative of the underwriters of the IPO, exercised its over-allotment option to purchase an additional 187,500 ordinary shares
of the Company at the public offering price of US$4.00 per share. The closing for the sale of the over-allotment shares took place on
November 6, 2024.
About PTL Limited
Headquartered in Hong Kong, we are an established
bunkering facilitator providing marine fuel logistics services for vessel refueling, primarily container ships, bulk carriers, general
cargo vessels, and chemical tankers. Targeting and serving the Asia Pacific market, we leverage our close relationships and partnership
within our established network in the marine fuel logistic industry, including the upstream suppliers and downstream customers, to provide
a one-stop solution for vessel refueling.
Forward-Looking Statements
Certain statements in this announcement are
forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s
current expectations, including the trading of its Ordinary Shares or the closing of the Offering. Investors can find many (but not all)
of these statements by the use of words such as “approximates,” “believes,” “hopes,” “expects,”
“anticipates,” “estimates,” “projects,” “intends,” “plans,” “will,”
“would,” “should,” “could,” “may” or other similar expressions. Although the Company believes
that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn
out to be correct. The Company cautions investors that actual results may differ materially from the anticipated results and encourages
investors to read the risk factors contained in the Company’s final prospectus and other reports it files with the SEC before making
any investment decisions regarding the Company’s securities. The Company undertakes no obligation to update or revise publicly any
forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required
by law.
For more information, please contact:
PTL Limited
Investor Relations
Email: info@petrolinkhk.com
PTL LIMITED AND SUBSIDIARIES
INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
PTL Limited and Subsidiaries
Unaudited Condensed Consolidated Balance Sheets
As of June 30, 2024 and December 31, 2023
(Expressed in U.S. Dollars, except for the number
of shares)
| | |
June 30, 2024 | | |
December 31, 2023 | |
| Assets | |
| | |
| |
| | |
| | |
| |
| Current assets | |
| | |
| |
| Cash | |
$ | 221,543 | | |
$ | 1,144,737 | |
| Accounts receivable | |
| 8,638,249 | | |
| 7,916,288 | |
| Due from a related party | |
| 3,448 | | |
| - | |
| Due from a director | |
| 122,749 | | |
| 122,749 | |
| Prepayments and other current assets | |
| 211,026 | | |
| 1,802,383 | |
| Total current assets | |
| 9,197,015 | | |
| 10,986,157 | |
| | |
| | | |
| | |
| Non-current assets | |
| | | |
| | |
| Operating lease right-of-use assets | |
| 56,687 | | |
| - | |
| Deferred initial public offering (“IPO”) costs | |
| 374,069 | | |
| 50,000 | |
| Total assets | |
$ | 9,627,771 | | |
$ | 11,036,157 | |
| Liabilities and Shareholders’ Equity | |
| | | |
| | |
| Current liabilities | |
| | | |
| | |
| Accounts payable | |
$ | 7,630,494 | | |
$ | 9,266,249 | |
| Income tax payable | |
| 264,249 | | |
| 165,902 | |
| Operating lease liabilities, current | |
| 36,832 | | |
| - | |
| Accrued expenses and other current liabilities | |
| 6,587 | | |
| 253,973 | |
| Total current liabilities | |
| 7,938,162 | | |
| 9,686,124 | |
| | |
| | | |
| | |
| Non-current liabilities | |
| | | |
| | |
| Operating lease liabilities, non-current | |
| 19,132 | | |
| - | |
| Total liabilities | |
| 7,957,294 | | |
| 9,686,124 | |
| | |
| | | |
| | |
| Shareholders’ equity | |
| | | |
| | |
| Ordinary shares, no par value, unlimited number of ordinary shares authorized, 11,250,000 ordinary shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively* | |
| 1 | | |
| 1 | |
| Retained earnings | |
| 1,670,476 | | |
| 1,350,032 | |
| Total shareholders’ equity | |
| 1,670,477 | | |
| 1,350,033 | |
| | |
| | | |
| | |
| Total liabilities and shareholders’ equity | |
$ | 9,627,771 | | |
$ | 11,036,157 | |
| * | Shares and per share data are
presented on a retroactive basis to reflect the nominal share issuance and share split. |
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
PTL Limited and Subsidiaries
Unaudited Condensed Consolidated Statements
of Operations and Comprehensive Income
For the Six Months Ended June 30, 2024 and 2023
(Expressed in U.S. Dollars, except for the number
of shares)
| | |
For the Six Months Ended
June 30, | |
| | |
2024 | | |
2023 | |
| Revenue | |
$ | 50,273,589 | | |
$ | 44,254,007 | |
| Cost of revenue | |
| (49,133,889 | ) | |
| (42,997,119 | ) |
| Gross profit | |
| 1,139,700 | | |
| 1,256,888 | |
| | |
| | | |
| | |
| Selling, general and administrative expenses | |
| (718,758 | ) | |
| (220,296 | ) |
| | |
| | | |
| | |
| Profit from operations | |
| 420,942 | | |
| 1,036,592 | |
| | |
| | | |
| | |
| Other income (expense) | |
| | | |
| | |
| Interest (expense) income, net | |
| (1,004 | ) | |
| 594 | |
| Other income | |
| 1,062 | | |
| 7,519 | |
| Currency exchange loss | |
| (2,209 | ) | |
| (632 | ) |
| Total other (expense) income, net | |
| (2,151 | ) | |
| 7,481 | |
| | |
| | | |
| | |
| Income before provision for income taxes | |
| 418,791 | | |
| 1,044,073 | |
| Income tax expense | |
| (98,347 | ) | |
| (150,578 | ) |
| Net income and total comprehensive income | |
$ | 320,444 | | |
$ | 893,495 | |
| | |
| | | |
| | |
| Earnings per share – basic and diluted* | |
$ | 0.028 | | |
$ | 0.079 | |
| | |
| | | |
| | |
| Weighted average shares outstanding – basic and diluted* | |
| 11,250,000 | | |
| 11,250,000 | |
| * | Shares and per share data are
presented on a retroactive basis to reflect the nominal share issuance and share split. |
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
PTL Limited and Subsidiaries
Unaudited Condensed Consolidated Statements
of Changes in Shareholders’ Equity
For the Six Months Ended June 30, 2024 and 2023
(Expressed in U.S. Dollars, except for the number
of shares)
| | |
For the Six Months Ended
June 30, 2023 | |
| | |
Ordinary Shares | | |
Retained | | |
| |
| | |
Shares* | | |
Amount | | |
Earnings | | |
Total | |
| Balance as of December 31, 2022 | |
| 11,250,000 | | |
$ | 1 | | |
$ | 413,912 | | |
$ | 413,913 | |
| | |
| | | |
| | | |
| | | |
| | |
| Net income for the period | |
| - | | |
| - | | |
| 893,495 | | |
| 893,495 | |
| | |
| | | |
| | | |
| | | |
| | |
| Balance as of June 30, 2023 | |
| 11,250,000 | | |
$ | 1 | | |
$ | 1,307,407 | | |
$ | 1,307,408 | |
| | |
For the Six Months Ended
June 30, 2024 | |
| | |
Ordinary Shares | | |
Retained | | |
| |
| | |
Shares* | | |
Amount | | |
Earnings | | |
Total | |
| Balance as of December 31, 2023 | |
| 11,250,000 | | |
$ | 1 | | |
$ | 1,350,032 | | |
$ | 1,350,033 | |
| | |
| | | |
| | | |
| | | |
| | |
| Net income for the period | |
| - | | |
| - | | |
| 320,444 | | |
| 320,444 | |
| | |
| | | |
| | | |
| | | |
| | |
| Balance as of June 30, 2024 | |
| 11,250,000 | | |
$ | 1 | | |
$ | 1,670,476 | | |
$ | 1,670,477 | |
| * | Shares and per share data are
presented on a retroactive basis to reflect the nominal share issuance and share split. |
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
PTL Limited and Subsidiaries
Unaudited Condensed Consolidated Statements
of Cash Flows
For the Six Months Ended June 30, 2024 and 2023
(Expressed in U.S. Dollars)
| | |
For the Six Months Ended
June 30, | |
| | |
2024 | | |
2023 | |
| Cash flows from operating activities: | |
| | |
| |
| Net income | |
$ | 320,444 | | |
$ | 893,495 | |
| Adjustments to reconcile net income to net cash (used in) provided by operating activities: | |
| | | |
| | |
| Operating lease expenses | |
| 15,039 | | |
| - | |
| | |
| | | |
| | |
| Changes in operating assets and liabilities: | |
| | | |
| | |
| Accounts receivable | |
| (721,961 | ) | |
| 229,887 | |
| Prepayments and other current assets | |
| 1,591,357 | | |
| 29,278 | |
| Accounts payable | |
| (1,635,755 | ) | |
| (1,135,736 | ) |
| Income taxes payable | |
| 98,347 | | |
| 150,578 | |
| Operating lease liabilities | |
| (15,762 | ) | |
| - | |
| Accrued expenses and other current liabilities | |
| (247,386 | ) | |
| (411 | ) |
| Net cash (used in) provided by operating activities | |
| (595,677 | ) | |
| 167,091 | |
| | |
| | | |
| | |
| Cash flows from financing activities: | |
| | | |
| | |
| Advance to a related party | |
| (3,448 | ) | |
| - | |
| Payments of offering costs related to initial public offering | |
| (324,069 | ) | |
| - | |
| Net cash used in financing activities | |
| (327,517 | ) | |
| - | |
| | |
| | | |
| | |
| Net (decrease) increase in cash | |
| (923,194 | ) | |
| 167,091 | |
| | |
| | | |
| | |
| Cash, beginning of year | |
| 1,144,737 | | |
| 92,042 | |
| | |
| | | |
| | |
| Cash, end of year | |
$ | 221,543 | | |
| 259,133 | |
| | |
| | | |
| | |
| Supplemental non-cash information | |
| | | |
| | |
| Operating lease right-of-use assets, obtained in exchange for operating lease obligations | |
$ | 70,378 | | |
$ | - | |
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
1. Organization and Business Description
Organization and Nature of Operations
PTL Limited (the “Company”) is a limited
liability company established under the laws of the British Virgin Islands on December 29, 2023. It is a holding company with no business
operation.
The Company owns 100% equity interest of (i) Petrolink
Energy Limited (“Petrolink Hong Kong”), a limited liability company established in Hong Kong on June 21, 2013; and (ii) Petrolink
Energy Pte. Ltd. (“Petrolink Singapore”), a private company limited by shares established in Singapore on February
5, 2024.
The Company, through its wholly-owned subsidiaries,
Petrolink Hong Kong and Petrolink Singapore, (collectively, the “Group”), is an established bunkering facilitator providing
marine fuel logistics services for vessel refuelling, primarily serving the Asia Pacific market. The Group leverages on its close relationships
and partnership within our established network in the marine fuel logistic industry, including the upstream suppliers and downstream customers,
to provide a one-stop solution for vessel refuelling. The Group purchases marine fuel from its suppliers and coordinate delivery of the fuel directly to its customers through the suppliers. As a bunker facilitator, the Group’s services mainly involve (i) facilitating with
its suppliers to supply fuel for the use by the customers’ vessels at various ports along their voyages in the Asia Pacific region;
(ii) arranging vessel refuelling activities at competitive pricing to the customers; (iii) offering trade credit to the customers for
vessel refuelling; (iv) handling unforeseeable circumstances faced by the customers and providing contingency solutions to the customers
in a timely manner; and (v) handling disputes, mainly in relation to quality and quantity issues on marine fuel, if any.
Reorganization
A reorganization of the legal structure of the
Company (the “Reorganization”) was completed on February 21, 2024. Prior to the Reorganization, Petrolink Hong Kong, the operating
subsidiary of the Company, was controlled by Mr. Tak Wing, Ho. As part of the Reorganization, PTLE Limited, being the immediate holding
company of the Company, was first incorporated under the laws of the British Virgin Islands on December 21, 2023 and was controlled by
Mr. Tak Wing, Ho. Subsequently, the Company was incorporated as a wholly owned subsidiary of PTLE Limited. On February 5, 2024, Petrolink
Singapore was incorporated in Singapore as a wholly-owned subsidiary of the Company. On February 21, 2024, Mr. Tak Wing, Ho transferred
his all ordinary shares in Petrolink Hong Kong to the Company. Consequently, the Company became the holding company of Petrolink Hong
Kong on February 21, 2024. The Company and its subsidiaries resulting from Reorganization has always been under the common control of
the same controlling shareholders before and after the Reorganization. The consolidation of the Company and its subsidiaries has been
accounted for at historical cost and prepared on the basis as if the aforementioned transactions had become effective as of the beginning
of the first period presented in the accompanying unaudited condensed consolidated financial statements. Results of operations for the
periods presented comprise those of the previously separate entities combined from the beginning of the period to the end of the period,
eliminating the effects of intra-entity transactions.
The accompanying unaudited condensed consolidated
financial statements reflect the activities of PTL Limited and the following entities:
| Subsidiaries |
|
Date of
Incorporation |
|
Jurisdiction of
Formation |
|
|
Percentage of
direct/indirect
Economic
Ownership |
|
Principal Activities |
| Petrolink Energy Limited (“Petrolink Hong Kong”) |
|
June 21, 2013 |
|
Hong Kong |
|
|
100% |
|
Providing marine fuel logistics services and one-stop solutions for vessel refuelling |
| Petrolink Energy Pte. Ltd. (“Petrolink Singapore”) |
|
February 5, 2024 |
|
Singapore |
|
|
100% |
|
Sales office |
Basis of Presentation and Consolidation
The accompanying unaudited condensed consolidated
financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.
GAAP”) and pursuant to the rules and regulations of the Securities Exchange Commission (“SEC”). The unaudited condensed
consolidated financial statements as of and for the six months ended June 30, 2024 include all adjustments (consisting of only normal
recurring adjustments) considered necessary to present fairly the financial position, results of operations and cash flows for such interim
periods. The results of operations for the six months ended June 30, 2024 are not necessarily indicative of results to be expected for
the full year ending December 31, 2024. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction
with the Company’s audited financial statements as of and for the years ended December 31, 2023 and 2022.
The unaudited condensed consolidated financial
statements include the financial statements of the Company and its wholly owned subsidiaries. All intercompany transactions and balances
among the Company and its subsidiaries have been eliminated upon consolidation.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
2. Summary of Significant Accounting Policies
Use of Estimates and Assumptions
The preparation of unaudited condensed consolidated
financial statements in conformity with U.S. GAAP requires the management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. These estimates and judgments are based on historical information, information
that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances.
Significant estimates required to be made by management, include, but are not limited to, the allowance for expected credit loss and uncertain
tax position. Actual results could differ from those estimates, and as such, differences could be material to the unaudited condensed
consolidated financial statements.
Functional Currency and Foreign Currency Translation and transaction
The functional currency of the Company and its
subsidiaries is the U.S. Dollars (“US$” or “$”). The Company’s unaudited condensed consolidated financial
statements are reported using the US$. Foreign currency transaction gains and losses are recognized upon settlement of foreign currency
transactions. In addition, for unsettled foreign currency transactions, foreign currency transaction gains and losses are recognized for
changes between the transaction exchange rates and month-end exchange rates. Foreign currency transaction gains and losses are included
in other income (expense), net, in the accompanying unaudited condensed consolidated statements of operations and comprehensive income
in the period incurred.
Cash
Cash includes cash on hand and demand deposits
in accounts maintained with commercial banks that can be added or withdrawn without limitation. The Company maintains the bank accounts
in Hong Kong. Cash balances in bank accounts in Hong Kong are insured under the Deposit Protection Scheme introduced by the Hong Kong
Government for a maximum amount of approximately US$64,103 (HK$500,000). Cash balances in bank accounts in Hong Kong are not otherwise
insured by the Federal Deposit Insurance Corporation or other programs.
Accounts Receivable
Accounts receivable is recognized and carried
at original invoiced amount less an allowance for expected credit loss.
The Company adopted ASU 2016-13, Financial Instruments
– Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This standard replaces the “incurred loss
methodology” credit impairment model with a new forward-looking methodology that reflects expected credit losses and requires consideration
of a broader range of reasonable and supportable information to inform credit loss estimates. In applying this standard, the Company has
adopted the loss rate methodology to estimate historical losses on accounts receivable. The Company has adopted the aging methodology
to estimate the credit losses on accounts receivable. The historical data is adjusted to account for forecasted changes in the macroeconomic
environment in order to calculate the current expected credit loss.
Prepayments
Prepayments represent advance payments made to
the service providers for future services. Prepayments are short-term in nature and are reviewed periodically to determine whether their
carrying value has become impaired. The Company considers the assets to be impaired if the realizability of the prepayments becomes doubtful.
For the six months ended June 30, 2024 and 2023, there was no impairment recorded as the Company considers all of the prepayments fully
realizable.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
2. Summary of Significant Accounting Policies (Continued)
Deferred IPO costs
The Company capitalizes certain legal, consultancy
and other professional fees that are directly associated with in process equity financings as deferred IPO costs until such financings
are consummated. After consummation of the equity financing, these costs are recorded in shareholders’ equity as a reduction of
additional paid in capital generated as a result of the offering. Should the equity financing for which those costs relate no longer be
considered probable of being consummated, all deferred offering costs will be charged to operating expenses in the statement of operations
and comprehensive income at such time. The Company has recorded deferred IPO costs of US$374,069 and US$50,000 as of June 30, 2024 and
December 31, 2023. The Company will incur additional offering costs during the year ending December 31, 2024 as part of its initial public
offering. The deferred IPO costs will be offset against the IPO proceeds upon completion of the offering.
Lease
The Company adopted ASU 2016-02 Leases
(Topic 842) (“Topic 842”) issued by the FASB. The adoption of Topic 842 resulted in the presentation of
operating lease right-of-use assets and operating lease liabilities on the unaudited condensed consolidated balance sheets.
The Company has assessed the following: (i) whether
any expired or existing contracts are or contains a lease, (ii) the lease classification for any expired or existing leases, and
(iii) initial direct costs for any expired or existing leases (i.e. whether those costs qualify for capitalization under ASU 2016-02).
The Company also elected the short-term lease exemption for certain classes of underlying assets including office space, warehouses
and equipment, with a lease term of 12 months or less.
The Company determines whether an arrangement
is or contain a lease at inception. A lease for which substantially all the benefits and risks incidental to ownership remain with the
lessor is classified by the lessee as an operating lease. All leases of the Company are currently classified as operating leases. Operating
leases are included in operating lease right-of-use (“ROU”) assets, operating lease liability, current, and operating
lease liability, non-current in the Company’s unaudited condensed consolidated balance sheets.
ROU assets represent the Company’s right
to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease.
The operating lease ROU assets and lease liabilities are recognized at lease commencement date based on the present value of lease payments
over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing
rate based on the information available at lease commencement date in determining the present value of lease payments. The operating lease
ROU assets also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to
extend or terminate the lease. Renewal options are considered within the ROU assets and lease liabilities when it is reasonably certain
that the Company will exercise that option. Lease expenses for lease payments are recognized on a straight-line basis over the lease
term.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
2. Summary of Significant Accounting Policies (Continued)
For operating leases with a term of one year or
less, the Company has elected not to recognize a lease liability or ROU asset on its unaudited condensed consolidated balance sheets.
Instead, it recognizes the lease payments as expenses on a straight-line basis over the lease term. Short-term lease costs are
immaterial to its unaudited condensed consolidated statements of operations and cash flows. The Company has operating lease agreements
with insignificant non-lease components and has elected the practical expedient to combine and account for lease and non-lease components
as a single lease component.
The Company reviews the impairment of its ROU
assets consistent with the approach applied for its other long-lived assets. The Company reviews the recoverability of its long-lived assets
when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment
of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash
flows of the related operations. The Company has elected to include the carrying amount of operating lease liabilities in any tested asset
group and include the associated operating lease payments in the undiscounted future pre-tax cash flows.
During the six months ended June 30, 2024,
the Company recognized respectively, ROU assets and operating lease liabilities of $70,378 and $70,378, in the unaudited condensed consolidated
balance sheets.
Revenue Recognition
The Company adopted the revenue standard Accounting
Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. The core principle of the revenue standard is that
a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration
to which the company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that
core principle:
Step 1: Identify the contract with the customer
Step 2: Identify the performance obligations in
the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the
performance obligations in the contract
Step 5: Recognize revenue when the company satisfies
a performance obligation.
The Company generally recognizes sales and distribution
of marine fuel revenue on a gross basis as the Company has control of the products or services before they are delivered to the Company’s
customers. In drawing this conclusion, the Company considered various factors, including latitude in establishing the sales price, discretion
in the supplier selection and that the Company is normally the primary obligor in the Company’s sales arrangements.
Revenue from the sales and distribution of marine
fuel is recognized at a point in time when the Company’s customers obtain control of the marine fuel, which is typically upon delivery
of each promised gallon or barrel to an agreed-upon delivery point. Shipping and handling activities are considered to be fulfillment
activities rather than promised services and are not, therefore, considered to be separate performance obligations. The Company’s
sales terms provide no right of return outside of a standard quality policy and returns are generally and have not been significant. Payment
terms are generally set at 30 days after the delivery of the fuel.
Cost of Revenue
The Company’s cost of revenue is primarily
comprised of the purchase of marine fuel and delivery services necessary in the course of sales and distribution of marine fuel.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
2. Summary of Significant Accounting Policies (Continued)
Employee Benefit Plan
Employees of the Company located in Hong Kong
participate in a compulsory saving scheme (pension fund) for the retirement of residents in Hong Kong. Employees are required to contribute
monthly to mandatory provident fund schemes provided by approved private organizations, according to their salaries and the period of
employment. The Company is required to contribute to the plan based on certain percentages of the employees’ salaries, up to a maximum
amount specified by the local government. Total expenses for the plan were $7,413 and $3,050 for the six months ended June 30, 2024 and
2023, respectively.
Income Taxes
The Company accounts for income taxes under ASC
740. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the unaudited
condensed consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases.
Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered
or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period including
the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
The provisions of ASC 740-10-25, “Accounting
for Uncertainty in Income Taxes,” prescribe a more-likely-than-not threshold for unaudited condensed consolidated financial statement
recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This interpretation also provides guidance
on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting
for interest and penalties associated with tax positions, and related disclosures.
Penalties and interest incurred related to underpayment
of income tax are classified as income tax expense in the period incurred.
The Company believes there were no uncertain tax
positions as of June 30, 2024 and December 31, 2023, respectively. The Company does not expect that its assessment regarding unrecognized
tax positions will materially change over the next 12 months. The Company is not currently under examination by an income tax authority,
nor has been notified that an examination is contemplated. As of June 30, 2024, income tax returns for the years ended December 31, 2017
through December 31, 2023 for OPS HK remain open for statutory examination by Hong Kong tax authorities.
Earnings Per Share
The Company computes earnings per share (“EPS”)
in accordance with ASC 260, “Earnings per Share” (“ASC 260”). ASC 260 requires companies with complex capital
structures to present basic and diluted EPS. Basic EPS are computed by dividing income available to ordinary shareholders of the Company
by the weighted average ordinary shares outstanding during the period. Diluted EPS takes into account the potential dilution that could
occur if securities or other contracts to issue ordinary shares were exercised and converted into ordinary shares. For the six months
ended June 30, 2024 and 2023, there were no dilutive shares.
The Company effectuated a share split of its issued
and outstanding shares at a ratio of 11,250,000 for one on July 11, 2024. As a result, the number of shares issued and outstanding increased
from 1 to 11,250,000 with no par value. The EPS for the six months ended June 30, 2024 and 2023, including its opening balances presented
has been adjusted to reflect the increased number of shares. The share split did not impact the total equity or net income of the Company.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
2. Summary of Significant Accounting Policies (Continued)
Commitments and Contingencies
In the normal course of business, the Company
is subject to contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of matters. Liabilities
for contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably
estimated.
If the assessment of a contingency indicates that
it is probable that a material loss is incurred and the amount of the liability can be estimated, then the estimated liability is accrued
in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable,
but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate
of the range of possible loss, if determinable and material, would be disclosed.
Loss contingencies considered remote are generally
not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed.
Related parties
Parties, which can be a corporation or individual,
are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant
influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject
to common control or common significant influence, such as a family member or relative, shareholder, or a related corporation.
Significant Risks
Currency Risk
Other than the Group’s sales and purchases
activities are transacted in US$, the Group’s other operating activities are transacted in HK$. Foreign exchange risk arises from
future commercial transactions, recognized assets and liabilities and net investments in foreign operations. The Group considers the foreign
exchange risk in relation to transactions denominated in HK$ with respect to US$ is not significant as HK$ is pegged to US$.
Concentration and Credit Risk
Financial instruments that potentially subject
the Company to the concentration of credit risks consist of cash and cash equivalents and accounts receivable. The maximum exposures of
such assets to credit risk are their carrying amounts as of the balance sheet dates. The Company deposits its cash and cash equivalents
with financial institutions located in Hong Kong. As of June 30, 2024 and December 31, 2023, $221,066 and $1,144,736 were deposited with
financial institutions located in Hong Kong. The Deposit Protection Scheme introduced by the Hong Kong Government insured each depositor
at one bank for a maximum amount of US$64,103 (HK$500,000). Otherwise, these balances are not covered by insurance. The Company believes
that no significant credit risk exists as these financial institutions have high credit quality and the Company has not incurred any losses
related to such deposits.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
2. Summary of Significant Accounting Policies (Continued)
For the credit risk related to accounts receivable,
the Company adopted ASU 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments.
The Company performs periodic credit evaluations of its customers’ financial condition and generally does not require collateral.
The Company has adopted the loss rate methodology to estimate historical losses on accounts receivable. The Company has adopted the aging
methodology to estimate the credit losses on accounts receivable. The historical data is adjusted to account for forecasted changes in
the macroeconomic environment in order to calculate the current expected credit loss. The Company seeks to maintain strict control over
its outstanding receivables. Overdue balances are reviewed regularly by the Directors. The Company believes that no significant credit
risk exists as the risk is mitigated by the Company’s assessment of its customers’ creditworthiness, years of relationship
and its ongoing monitoring of outstanding balances.
For the six months ended June 30, 2024 and 2023,
most of the Company’s assets were located in Hong Kong and most of the Company’s revenue were derived from its subsidiary
located in Hong Kong. The Company has a concentration of its revenue, purchases, accounts receivable and accounts payable with specific
customers and suppliers.
For the six months ended June 30, 2024, two customers
accounted for approximately 23.3% and 13.1% of the Company’s total revenue. For the six months ended June 30, 2023, one customer
accounted for approximately 20.3% of the Company’s total revenue.
As of June 30, 2024, one customer’s accounts
receivable accounted for approximately 59.2% of the total accounts receivable. As of December 31, 2023, three customers’ accounts
receivable accounted for approximately 38.6%, 17.0% and 11.9% of the total accounts receivable.
For the six months ended June 30, 2024, three
suppliers accounted for approximately 35.8%, 15.8% and 12.7% of the Company’s total purchases. For the six months ended June 30,
2023, two suppliers accounted for approximately 46.7% and 23.0% of the Company’s total purchases.
As of June 30, 2024, three suppliers’ accounts
payable accounted for approximately 43.9%, 19.8% and 17.1% of the total accounts payable. As of December 31, 2023, three suppliers’
accounts payable accounted for approximately 50.7%, 22.0% and 13.6% of the total accounts payable.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
2. Summary of Significant Accounting Policies (Continued)
Recently Accounting Pronouncements
The Company considers the applicability and impact
of all accounting standards updates (“ASUs”). Management periodically reviews new accounting standards that are issued. Under
the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”), the Company meets the definition of an emerging
growth company, or EGC, and has elected the extended transition period for complying with new or revised accounting standards, which delays
the adoption of these accounting standards until they would apply to private companies.
In January 2021, the Financial Accounting Standards
Board (“FASB”) issued ASU No. 2021-01, Reference Rate Reform (Topic 848). ASU No. 2021-01 is an update of ASU No. 2020-04,
which is in response to concerns about structural risks of interbank offered rates, and particularly the risk of cessation of LIBOR. Regulators
have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based
and less susceptible to manipulation. ASU No. 2020-04 provides optional guidance for a limited period of time to ease the potential burden
in accounting for (or recognizing the effects of) reference rate reform on financial reporting. ASU No. 2020-04 is elective and applies
to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference
LIBOR or another reference rate expected to be discontinued because of reference rate reform. The ASU No. 2021-01 update clarifies that
certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are
affected by the discounting transition. The amendments in this update are effective immediately through December 31, 2022, for all entities.
On December 21, 2022, the FASB issued a new Accounting Standards Update ASU No. 2022-06, Reference Rate Reform (Topic 848): Deferral of
the Sunset Date of Topic 848, that extends the sunset (or expiration) date of ASC Topic 848 to December 31, 2024. This gives reporting
entities two additional years to apply the accounting relief provided under ASC Topic 848 for matters related to reference rate reform.
The Company does not expect the cessation of LIBOR to have a material impact on the financial position, results of operations, cash flows
or disclosures.
In November 2023, the FASB issued ASU No. 2023-07,
Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07), which requires an enhanced disclosure of
significant segment expenses on an annual and interim basis. This guidance will be effective for the annual periods beginning the year
ended December 31, 2024, and for interim periods beginning January 1, 2025. Early adoption is permitted. Upon adoption, the guidance should
be applied retrospectively to all prior periods presented in the financial statements. The Company does not expect the adoption of this
guidance to have a material impact on its unaudited condensed consolidated financial statements.
In December 2023, the FASB issued ASU No. 2023-09,
Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which improves the transparency of income tax disclosures
by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes
paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures.
This guidance will be effective for the annual periods beginning the year ended December 31, 2025. Early adoption is permitted. Upon
adoption, the guidance can be applied prospectively or retrospectively. The Company does not expect the adoption of this guidance to
have a material impact on its unaudited condensed consolidated financial statements.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
3. Accounts Receivable
Accounts receivable consisted of the following:
| | |
June 30, 2024 | | |
December 31, 2023 | |
| Accounts receivable | |
$ | 8,638,249 | | |
$ | 7,916,288 | |
| Less: allowance for expected credit loss | |
| - | | |
| - | |
| Accounts receivable, net | |
$ | 8,638,249 | | |
$ | 7,916,288 | |
There was no credit loss for the six months ended June 30, 2024 and
the year ended December 31, 2023.
4. Prepayments and Other Current Assets
Prepayments and other current assets consisted of the following:
| | |
June 30, 2024 | | |
December 31, 2023 | |
| Other deposits | |
$ | 211,026 | | |
$ | 209,420 | |
| Advance to suppliers | |
| - | | |
| 1,592,963 | |
| | |
$ | 211,026 | | |
$ | 1,802,383 | |
5. Leases
Operating leases as lessee
As of June 30, 2024, the Company has operating
leases recorded on its unaudited condensed consolidated balance sheets for office spaces that expire on various dates in 2026. The Company
does not have options to extend or cancel the existing lease agreements for its existing facilities prior to their respective expiration
dates. When determining the lease term, at lease commence date, the Company considers options to extend or terminate the lease when it
is reasonably certain that it will exercise or not exercise that option. The Company’s lease arrangements may contain both lease
and non-lease components. The Company has separately accounted for lease and non-lease components based on their nature. Payments
under the Company’s lease arrangement are fixed.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
5. Leases (Continued)
The following table shows ROU assets and operating
lease liabilities, and the associated financial statement line items as of:
| | |
June 30, 2024 | | |
December 31, 2023 | |
| Assets | |
| | | |
| | |
| Operating lease right-of-use assets, net | |
$ | 56,687 | | |
$ | - | |
| | |
| | | |
| | |
| Liabilities | |
| | | |
| | |
| Operating lease liabilities, current | |
$ | 36,832 | | |
$ | - | |
| Operating lease liabilities, non-current | |
$ | 19,132 | | |
$ | - | |
| | |
| | | |
| | |
| Weighted average remaining lease term (in years) | |
| Approximately 1.58 years | | |
| Not applicable | |
| Weighted average discount rate (%) | |
| 5.22 | % | |
| Not applicable | |
Information relating to operating lease activities
during the six months ended June 30, 2024 and 2023 are as follows:
| | |
For the six months ended
June 30, | |
| | |
2024 | | |
2023 | |
| Operating lease right-of-use assets, obtained in exchange for operating lease liabilities | |
$ | 70,378 | | |
$ | - | |
| | |
| | | |
| | |
| Operating lease expenses | |
| | | |
| | |
| Amortization of operating lease right-of-use assets | |
$ | 13,691 | | |
$ | - | |
| Interest of lease liabilities | |
| 1,348 | | |
| - | |
| Total operating lease expenses | |
$ | 15,039 | | |
$ | - | |
Maturities of lease liabilities were as follows:
| | |
As of
June 30,
2024 | |
| 2025 | |
$ | 38,901 | |
| 2026 | |
| 19,429 | |
| Total lease payments | |
$ | 58,330 | |
| Less: imputed interest | |
| (2,366 | ) |
| Total | |
$ | 55,964 | |
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
6. Accrued Expenses and Other Current Liabilities
Components of accrued expenses and other current liabilities are as
follows as of:
| | |
June 30, 2024 | | |
December 31, 2023 | |
| Accruals for operating expenses | |
$ | 4,463 | | |
$ | 2,896 | |
| Other payables | |
| 2,124 | | |
| 251,077 | |
| Total | |
$ | 6,587 | | |
$ | 253,973 | |
7. Income Taxes
British Virgin Islands
Under the current laws of the British Virgin Islands,
the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends to the shareholders, no British
Virgin Islands withholding tax will be imposed.
Hong Kong
In accordance with the relevant tax laws and regulations
of Hong Kong, a company registered in Hong Kong is subject to income taxes within Hong Kong at the applicable tax rate on taxable income.
Hong Kong profit tax rates are 8.25% on assessable profits up to $256,410 (HK$2,000,000), and 16.5% on any part of assessable profits
over $256,410 (HK$2,000,000).
Singapore
A company incorporated in Singapore is subject
to Singapore Corporate Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant
Singapore tax laws. The applicable tax rate is 17% in Singapore, with 75% of the first $7,463 (S$10,000) taxable income and 50% of the
next $141,791 (S$190,000) taxable income exempted from income tax.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
7. Income Taxes (Continued)
The components of the income tax expense are as follows:
| |
|
For the six months ended
June 30, |
|
| |
|
2024 |
|
|
2023 |
|
| Current |
|
|
|
|
|
|
| BVI |
|
$ |
- |
|
|
$ |
- |
|
| Hong Kong |
|
|
98,347 |
|
|
|
150,578 |
|
| Deferred |
|
|
|
|
|
|
|
|
| BVI |
|
|
- |
|
|
|
- |
|
| Hong Kong |
|
|
- |
|
|
|
- |
|
| Provision for income taxes |
|
$ |
98,347 |
|
|
$ |
150,578 |
|
Income tax payable consist of the following as
of:
| | |
June 30, 2024 | | |
December 31, 2023 | |
| Income tax payable | |
$ | 264,249 | | |
$ | 165,902 | |
| | |
$ | 264,249 | | |
$ | 165,902 | |
As of June 30, 2024 and December 31, 2023, the
Company and its subsidiaries did not have any net operating loss carry-forward.
The following table reconciles Hong Kong statutory
rates to the Company’s effective tax:
| | |
For the six months ended
June 30, | |
| | |
2024 | | |
2023 | |
| Profit before income taxes | |
$ | 418,791 | | |
$ | 1,044,073 | |
| Hong Kong Profits Tax rate | |
| 16.5 | % | |
| 16.5 | % |
| Income taxes computed at Hong Kong Profits Tax rate | |
| 69,101 | | |
| 172,272 | |
| Reconciling items: | |
| | | |
| | |
| Tax effect of income that is not taxable* | |
| (57 | ) | |
| (98 | ) |
| Tax effect of expenses that are not deductible ** | |
| 50,901 | | |
| - | |
| Effect of two-tier tax rate | |
| (21,598 | ) | |
| (21,596 | ) |
| Income tax expense | |
$ | 98,347 | | |
$ | 150,578 | |
| * | Income that is not taxable
mainly consisted of the interest income which is non-taxable under Hong Kong income tax law. |
| ** | Expenses that are not deductible
mainly consisted of legal and professional fee which are non-deductible under Hong Kong income tax law |
Uncertain tax positions
The Company evaluates each uncertain tax position
(including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits
associated with the tax positions. As of June 30, 2024 and December 31, 2023, the Company did not have any significant unrecognized uncertain
tax positions. The Company did not incur any interest and penalties related to potential underpaid income taxes for the six months ended
June 30, 2024 and 2023. The Company also does not anticipate any significant increases or decreases in unrecognized tax benefits in the
next 12 months from June 30, 2024.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
8. Shareholders’ Equity
Ordinary shares
The Company was established under the laws of
the British Virgin Islands on December 29, 2023. The authorized number of Ordinary Shares was unlimited with no par value. On December
29, 2023, the Company issued 1 share to the controlling shareholder at no par value.
On July 11, 2024, the Company effectuated a share
split of its issued and outstanding shares at a ratio of 11,250,000 for one, such that after such share split, the number of issued shares
in the Company was 11,250,000 ordinary shares with no par value. As a part to the Company’s recapitalization prior to the completion
of its anticipated initial public offering, the Company believes it is appropriate to reflect these share issuances as nominal share issuance
on a retroactive basis similar to share split pursuant to ASC 260. The Company has retroactively adjusted all shares and per share
data for all the periods presented. As a result of all events mentioned above, the Company had an unlimited number with no par value ordinary
shares authorized, of which 11,250,000 were issued and outstanding as of June 30, 2024 and December 31, 2023.
9. Related Party Balance and Transactions
The following is a list of related parties which
the Company has balances/transactions with:
| (a) |
Mr. Tak Wing, Ho, a director of the Company. |
| (b) |
Tri Co Trading Co., Limited, controlled by Mr. Chi Nap, Yau, who was a former director of Petrolink Hong Kong from November 1, 2022 to March 7, 2023. |
| (c) |
PTLE Limited, an immediate holding company of the Company. |
As of June 30, 2024 and December 31, 2023, the
balance of amount due from a director was as follows:
| | |
June 30, 2024 | | |
December 31, 2023 | |
| Mr. Tak Wing, Ho (a)(1) | |
$ | 122,749 | | |
$ | 122,749 | |
| | |
$ | 122,749 | | |
$ | 122,749 | |
| (1) |
The balance as of June 30, 2024 and December 31, 2023 represented the advances for operational purposes. These amounts were unsecured, interest-free and repayable on demand. As of the date of this report, the entire balance has been settled with a director on July 19, 2024. |
| b. |
Due from a related party |
As of June 30, 2024 and December 31, 2023, the
balance of amount due from a related party was as follows:
| | |
June 30, 2024 | | |
December 31, 2023 | |
| PTLE Limited (c) (1) | |
$ | 3,448 | | |
$ | - | |
| | |
$ | 3,448 | | |
$ | - | |
| (1) |
The balance as of June 30, 2024 and December 31, 2023 represented the advances to PTLE Limited (c) for operational purpose. The amount was unsecured, interest-free and repayable on demand. |
| c. |
Related party transactions |
The Company sells marine fuel to Tri Co Trading
Co., Limited (b). For the six months ended June 30, 2024 and 2023, the sales of marine fuel to Tri Co Trading Co., Limited (b) were nil
and $3,731,638, respectively.
PTL Limited and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial
Statements
10. Commitments and Contingencies
Commitments
As of June 30, 2024, the Company did not have
any significant capital and other commitments.
Contingencies
The Company is subject to legal proceedings and
regulatory actions in the ordinary course of business. The results of such proceedings cannot be predicted with certainty, but the Company
does not anticipate that the final outcome arising out of any such matters will have a material adverse effect on its unaudited condensed
consolidated financial position, cash flows or results of operations on an individual basis or in the aggregate. As of June 30, 2024 and
December 31, 2023, the Company is not a party to any material legal or administrative proceedings.
11. Segment Reporting
ASC 280, “Segment Reporting”, establishes
standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure
as well as information about geographical areas, business segments and major customers in financial statements for details on the Company’s
business segments.
The Company uses the management approach to determine
reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief
operating decision maker (“CODM”) for making decisions, allocating resources and assessing performance.
Based on the management’s assessment, the
Company determined that it has only one operating segment and therefore one reportable segment as defined by ASC 280. The Company’s
assets are mostly located in Hong Kong and most of the Company’s revenue and expense are derived in Hong Kong. The single segment
represents the Company’s core business of providing marine fuel logistics services and one-stop solutions for vessel refuelling
mainly in Hong Kong. The following table shows the revenue by geographical location of the Company’s revenue for the six months
ended June 30, 2024 and 2023, respectively, where is based on the location at which the marine fuel is delivered to the customer:
| | |
For the six months ended
June 30, | |
| | |
2024 | | |
2023 | |
| Hong Kong | |
$ | 47,565,305 | | |
$ | 41,234,601 | |
| United Arab Emirates | |
| - | | |
| 1,584,578 | |
| Singapore | |
| 2,708,284 | | |
| 238,079 | |
| Saudi Arabia | |
| - | | |
| 780,000 | |
| China | |
| - | | |
| 148,188 | |
| Others* | |
| - | | |
| 268,561 | |
| Total | |
$ | 50,273,589 | | |
$ | 44,254,007 | |
| * |
Others includes Netherlands and Kenya. |
12. Subsequent Events
On October 17, 2024, the Company closed its IPO
of 1,250,000 ordinary shares, no par value per share, which were priced at $4.00 per share, and the offering was conducted on a firm
commitment basis. The ordinary shares were approved for listing on the Nasdaq Capital Market and commenced trading under the ticker symbol
“PTLE” on October 16, 2024.
On November 4, 2024, Dominari Securities LLC,
as the representative of the underwriters of the IPO, exercised its over-allotment option to purchase an additional 187,500 ordinary shares
of the Company at the public offering price of US$4.00 per share. The closing for the sale of the over-allotment shares took place on
November 6, 2024.
The Company evaluated all events and transactions
that occurred after June 30, 2024 up through the date the Company issued these unaudited condensed consolidated financial statements.
Other than the event disclosed above, there was no other subsequent event occurred that would require recognition or disclosure in the
Company’s unaudited condensed consolidated financial statements.
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